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Bloomberg
Sweden may face weeks or even months of political gridlock after an inconclusive election result left the biggest Scandinavian economy without a clear candidate to form a government.
Neither the Social Democrat-led coalition of Prime Minister Stefan Lofven nor the opposition Alliance bloc won enough votes to form majority governments, as a nationalist group that has talked of dragging Sweden out of the European Union drew in almost a fifth of the electorate.
Sweden is the latest European country in which a populist surge fuelled by anti-immigration sentiment is changing the political landscape. Though Lofven has presided over an economic upswing that has fed a rise in employment, Sunday’s vote shows many Swedes were more concerned about tackling a record influx of foreigners after about 600,000 immigrants entered the country of 10 million over the past five years.
A near complete preliminary count of electoral districts gave Lofven’s parties 144 seats in the 349-member parliament, and the Alliance 143 seats. The anti-immigration Sweden Democrats, which aren’t part of either bloc, were poised to get about 62 seats, not quite as many as some pre-election polls indicated but significantly better than in 2014.
The result is set to trigger a potentially bitter contest between Lofven and Ulf Kristersson, who leads the Moderate Party that dominates the Alliance bloc. Lofven, who led his party to its worst election result since 1921, has made clear he rejects the nationalist agenda of the Sweden Democrats, ruling out cooperation with the party. Kristersson has been less clear. The 54-year-old former gymnast, who has led the Moderates for a little less than a year, was quick to call on Lofven to step down after the vote count became clear.
At Nordea Bank AB, the biggest Nordic lender, economist Andreas Wallstrom warned that the result sets the stage for a protracted period during which the main parties will fight to form a viable government. But he also noted that the outcome is unlikely to alter the trajectory of monetary policy. The Swedish currency was little changed overnight, ahead of trading in Stockholm.
As leader of the center-right bloc, Kristersson wants to cut taxes and some social benefits in order to get more people into the labour market.